The director-general finally resigned after the BBC was forced to pay £185,000 to Lord McAlpine after a Newsnight investigation wrongly implicated him in a child abuse scandal.

He had already come under fire for his handling of the Savile revelations and furore over the decision by Newsnight to axe its investigation into the Jim'll Fix It star.

It emerged last week that he walked away with his £450,000 year's salary, a year's private healthcare and tens of thousands of pounds for legal advice and to help handle the media.

Much of the committee session, where acting director-general Tim Davie also gave evidence, was devoted to the pay-off and Lord Patten's role.

Describing his conversation with Mr Entwistle before he stepped down, he told MPs he had said: "We are not urging you to go but we are not urging you to stay."

Lord Patten said that "absolutely and unequivocally" there had been no political pressure to get Mr Entwistle out of the job.

The executive had wanted to leave by "consensual termination" but wanted his pay for "12 months or more", the committee was told.

Lawyers had told Lord Patten that the BBC would be risking paying an extra £80,000 if they did not strike a deal, because of the likelihood of a constructive or unfair dismissal claim.

He said: "£450,000 is one hell of a lot of money. The idea that I did not understand how politically difficult it would be suggests a degree of political innocence on my part which I have to tell you does not exist, but the options I had were absolutely clear.

"We either had to deal with it quickly there and then, broadly speaking on the terms of 12 months - though that was less than we were asking for - or we had to go to constructive dismissal and constructive dismissal would have landed us with exactly the same amount of money, plus almost certainly another £80,000 of unfair dismissal."

He added that he had made sure the figure was "defensible" when he was taking advice from law firm Baker & McKenzie.

"Their agreement was not only is it defensible but it is better than any other course of action, unless we wanted the BBC to drift on without somebody at the top," he said.

MPs heard the money is not due to be paid until December and that the deal includes a "claw back" if the inquiries currently under way reveal any wrongdoing.

Nevertheless, Lord Patten said: "I do wish that his lawyers had counselled him strongly to accept £225,000, of course I do, because I think he does not deserve the damage to his reputation."

He distanced himself from the decision to appoint Mr Entwistle in the first place after a recruitment process that cost £186,000, stressing that it was a decision taken by the Trust as a whole.

"Pretty much everyone said at the time it was a very good choice," he said. "I think he was completely overwhelmed by Savile and all that came after it."

Both Lord Patten and Mr Davie were scathing about the botched Newsnight investigation into Lord McAlpine, branding it "shoddy" journalism and an "appalling editorial judgement".

The Pollard Review into the shelved Newsnight report on Savile is due next month but a second review into the wider culture at the BBC could take much longer.

Lord Patten said the BBC and licence fee-payers will have to "bear the costs" of the inquiries in the wake of the Savile scandal, "however much they are".

Legal costs in relation to the Pollard Review alone have already hit £200,000, the committee was told.